Why Aren't There More Foreign Female Entrepreneurs?

By
The Alagiri Immigration Law Firm
|October 11, 2011

The voice on the other end of the phone caught me off-guard. Young, energetic
and slightly accented, the voice asked whether the recently announced
immigration policies could help her to start a company. As an immigration
attorney, this was a typical query for me to receive. What wasn’t
typical was that the voice belonged to a woman — a
foreign female entrepreneur!

In conjunction with its recent economic plan to spur the U.S. economy, the
White House announced an immigration policy shift easing visa restrictions in an effort to attract and retain foreign entrepreneurs.
The White House is right to focus on foreign entrepreneurs. According
to a recent study by the Kauffman Foundation, in 2005, immigrant-founded
technology and engineering companies produced $52 billion in sales and
450,000 jobs. To be sure, these new immigration policies are highly welcome.
But, in the midst of the worst financial crisis of our generation and
record high jobless levels, we must do even more.

Enter the foreign female entrepreneur. They are one of our greatest strengths
and, given the opportunity, could be a driving force in our economic recovery.
But, unfortunately, foreign female entrepreneurs are a rare breed in the
U.S. They constitute less than 1% of all founders of high technology software
companies in the U.S (female high-tech founders generally account for 1% of tech founders). This is surprising because this demographic is a gold
mine. They possess the combined traits of two highly successful high-tech
entrepreneur groups –– women and immigrants.

According to a 2010 study by Illuminate Ventures, women tech entrepreneurs
are less likely to fail and have a 12% higher rate of return than their
male counterparts, all while using, on average, one–third less capital.
Similarly impressive, immigrant tech entrepreneurs are highly educated,
creative, and inspired risk takers.

Combine these two groups and you get one super-charged, powerhouse of a
high-tech demographic known as the foreign female entrepreneur.

So, why are there so few of them?

The argument that immigrant women simply aren’t interested in technology
or don’t have the right education is unfounded. According to recent
statistics released by the National Science Foundation, the number of
women around the world pursuing graduate degrees in math, science, and
engineering almost equals the number of men. In fact, the number of foreign
females pursuing such degrees in the U.S. has nearly doubled in the past 15 years.

In interviews I conducted with foreign female tech-founders from the U.K.,
Singapore, Korea, and Canada, they said that their near non-existence
is due primarily to a lack of a network and a “silicon ceiling.”
Immigrant women wanting to start a company typically lack the necessary
old boy’s network, and all of the women I spoke with agreed that
it’d be difficult to succeed without one.

American women entrepreneurs more naturally have a network due to connections
they’ve made, for example, through local friends or jobs. Immigrant
males, specifically Indian immigrant males, have built a network as a
result of having come first to the U.S. 30 years ago and by working hard,
becoming successful, and then helping each other.

The foreign women I interviewed also said that they’ve found it difficult
to succeed because the
“silicon ceiling” inhibits them from obtaining funding from
private investors. According to them, investors are mostly white American
men who gravitate toward their own. Investors themselves have said, quite
bluntly, that there does exist a bias against funding women, let alone
immigrant women. One investor, for example, has said that “a ton
of us decide not to invest, support, promote or work with women because
of this whole ‘marriage / pregnancy’ hurdle that most women
will face in their career.”

These women, though, aren’t so easily deterred. They’ve sacrificed
too much to come here, but more importantly, they want in on the expansive
U.S. market and the incredible U.S. talent.

So, what can be done to help these foreign women succeed, and thereby create
jobs that benefit us all? Friendlier visa policies for entrepreneurs are
certainly positive steps, but they fall short. The government should sponsor
mentorship programs targeted specifically to foreign female entrepreneurs.
This proposal isn’t so far-fetched. The City of Chicago, among others,
for example, has enterprisingly created
“The Office of New Americans” to provide support to its immigrant entrepreneur community.

On a private level, investors would do well in creating startup funding
firms just for these women. Existing popular early-stage investment funds
are currently oversubscribed, so it makes sense to carve out such niche
sub-groups.

Back on the phone with my female caller, I explained to her that the announced
immigration policies unfortunately wouldn’t directly help her weather
the obstacles she faces. Not dissuaded, she calmly stated that she wants
to be, and needs to be, CEO of her own company. With the right support
system, she could be, and could aid in changing the course of our economy
at the same time.

Photos, top to bottom: Aziza Ibrahim, also known as “Um Alaa”,
drives her truck loaded with gas cylinders in Amman February 11, 2010.
Um Alaa is the first Jordanian woman to operate a cooking gas delivery
agency. Instead of setting up a traditional business to raise the standard
of living for her family, she decided to establish this agency of her
own to break the decades-long male dominance in this field of work. Um
Alaa says she did extensive research and had lengthy discussions with
her family before going ahead with this business. REUTERS/Ali Jarekji;
Martha Stewart visits the launch pad for the Russian Soyuz TMA-10 spacecraft
at Baikonur Cosmodrome April 6, 2007. REUTERS/Stringer

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